Staff with the Virginia State Corporation Commission (SCC) recently concluded that a proposed project by American Electric Power (NYSE:AEP) companies “will significantly reinforce the reliability of the transmission system in the Roanoke [Va.] area and surrounding region.”
Virginia Transco, a wholly owned subsidiary of AEP Transmission Holding Company, which is in turn a wholly owned subsidiary of AEP, and APCo, a wholly owned direct subsidiary of AEP, filed on May 2 the application with the SCC for approval and issuance of certificates of public convenience and necessity for the Cloverdale substation extra high voltage (EHV) transmission expansion project within Botetourt County, Va., according to the Sept. 24 prefiled staff testimony.
Improvements at the substation are proposed to address certain deficiencies projected in PJM Interconnection’s regional transmission expansion plan (RTEP), which identified certain projected thermal problems during light loading conditions, starting in spring 2014, and certain projected voltage problems during peak loading conditions, starting in summer 2015, staff added.
The application also identified two 500/345-kV transformers at the substation that are approaching the end of their useful lives and need to be replaced to maintain reliability.
Staff also noted that a market efficiency analysis conducted by PJM identified economic benefits from increasing the capability of the 500-kV Cloverdale-Lexington interconnection between AEP and Dominion Virginia Power in order to relieve significant congestion existing on the bulk transmission system in the area.
“According to the application, the proposed project will also facilitate a substantial reduction in congestion on the transmission system in the region,” staff said. “The proposed project is consistent with existing and future land use plans, and [the Virginia Department of Environmental Quality (DEQ)] has provided its recommendations for minimizing potential environmental impacts,” staff said. “DEQ’s recommendations may change, however, based upon the discovery of additional streams and wetlands at the project site.”
APCo and Virginia Transco propose to build certain improvements and additions to EHV transmission facilities located at the Cloverdale substation in Cloverdale, Va. The substation currently consists of two physically separate substation yards – the West Yard and the North Yard – located about 2,400 feet apart and connected by a 345-kV tie line.
The Cloverdale improvements, all to be located at or adjacent to the existing substation, consist of installation of a new 765/500-kV transformer bank and two new 500/345-kV transformer banks; construction of a new 500-kV substation yard; construction of four short new EHV transmission lines between the existing yards and the proposed new yard of the Cloverdale substation; partial relocation of four existing transmission lines adjacent to the Cloverdale substation; and installation of associated substation improvements, including switches, staff added.
APCo owns about three-fourths of the 100-acre project site, and the approximate 25-acre area between the existing North Yard and the proposed East Yard of the Cloverdale substation is owned by a third-party landowner, but is crossed by the right-of-ways (ROWs) for seven existing APCo transmission lines. The companies intend to negotiate one continuous easement across the property or purchase the entire property depending on the landowner’s preference, staff added.
Currently, there are 25 transmission structures associated with the seven existing lines within the 100-acre project site. After the construction of four new lines, partial relocation of four lines and removal of two lines, there will be about 40 transmission line structures on the site, about 33 of which will be new.
Staff also said that the companies estimate about 36 months will be needed for engineering, design, ROW acquisition, permitting, material procurement and construction. The companies desire an in-service date of Dec. 31, 2016.
The estimated cost of all facilities to be included in the proposed project is about $237m, with about $155m of the total for material costs, including applicable overheads.
“A significant portion of the material cost is for the 765/500-kV and 500/345-kV substation transformers,” staff said. “The staff believes the estimated cost of these transformers is reasonable based on its review of literature on the costs for transmission lines and substations.”
AEP and PJM identified the proposed project as the most cost-effective solution to address three main concerns, including certain voltage violations of applicable transmission planning criteria under a number of double contingency outages beginning in the summer of 2015.
The companies’ application provided additional information to allow the staff to verify the assertion that the proposed project is needed to reliably serve the projected increase in load in the Roanoke area. For instance, the companies provided descriptions of the load growth studies, load flow studies and contingency analyses underpinning the companies’ conclusions.
“[T]he staff verified the companies’ conclusions from load flow studies and contingency analyses that transmission planning criteria violations could occur during projected summer 2015 peak load conditions,” staff said.
The application also listed benefits of the proposed project, including that it enhances operational performance and improves reliability for more than 900 MW of load in the Roanoke area.
Staff also noted that all three alternative projects identified by the companies were determined to be uneconomical, in addition to having other disadvantages compared to the proposed project.
Furthermore, staff agreed with the companies that the proposed project is unsuitable as an underground project and would provide little or no aesthetic mitigation.
Among other things, staff said it also agreed that the project is essential to support ongoing economic development within the Roanoke area, noting that the proposed project, together with planned and ongoing improvements to the Cloverdale-Lexington 500-kV transmission line, will relieve congestion on the interface with the Dominion Virginia Power transmission system to the north, thereby improving reliability and market efficiency.
Dominion Virginia Power is a subsidiary of Dominion Resources (NYSE:D).